There are numerous tax myths surrounding the US Internal Revenue Service, due to a lack of information on tax education. The taxpayers do not seem to have very clear how to make the tax declaration, what are the expenses and income they must report to the Treasury and the consequences they may face. The IRS handles all of these paperwork and even this for the work of reaching agreements to accommodate tax payments to your needs. Keep your payments on a daily basis-with custom rates if necessary-and you won’t have any problems with the Internal Revenue Service.
Internal Revenue Service (IRS)
This part of the administration reports to a federal agency of the United States government, whose mission is to collect taxes and ensure that tax laws are enforced. Operating since 1862 as an initiative of President Lincoln to mitigate the effects of World War II and help meet its costs. It is one of the most feared departments of the state by citizens, but the truth is that it is the most “harmless”.
Most common myths
There are many baseless beliefs against the Internal Revenue Service. Prison sentences for everyone, agents at your door, phone harassment to collect debts, among many others. Let’s see which are the most repeated and deny them. Will we get people to stop fearing the IRS? Let’s try.
- “IRS will come to my house if I don’t pay my taxes”. This belief is very common and can not be further from reality. IRS house calls are as frequent as the Haley Comet. Not even in the case of an audit, since if additional information is required, it is requested in writing. The usual procedure is to receive a letter requesting payment, no more and no less.
- “I will be called on the phone if I have to pay taxes”. Again, wrong. Whenever the IRS wants to claim your tax, they will send you a letter with the steps to follow, but never present it in person. If you ever get a call from this guy, or saying that the IRS is calling, hang up, because it will be a scam.
- “I can be put in jail for duty taxes”. Many of us are fans of The Godfather, but we do not carry out the same criminal economic activities, right? Imprisonment is less common than is commonly believed and is the last resort when it comes to tax fraud. Only 60% of a sum of 584 people who were charged with tax fraud in 2017 were sentenced to prison.
- “They will hire 87,000 new agents to audit everyone”. Sooner or later, people retire. It’s a fact of life. That number of 87,000 agents that resounded so much, refers to the estimate number of hiring that was made in 2021 by the Treasury Department. The aim is to prosecute high-income evaders, not the average citizen. How could anyone think that 87,000 auditors would be hired?
- “IRS does not accept negotiations”. Blatantly false. If anything characterizes the IRS, it is its willingness to reach agreements. Offer customized payment plans, 120-day extensions, and you can even reduce the amount of your debt if it is proven that you are unable to pay.
- “Deducting my home office will get me into trouble”. Only if deductions are found to be suspicious or disproportionate, the IRS may conduct a more thorough investigation. If not the case, no need to worry.
- “I don’t have to pay taxes for illegal income”. Perhaps the problem lies in obtaining income illegally. However, that money must be declared. Wherever it comes from, all incoming money has to be declared.
- “I can declare my pet as a dependent”. We are many who adore our pets as if they were our children, but the reality is that they are not. Logically, the pet cannot be included as a dependent on our tax return.
Can I be fined for not responding to a letter from the IRS? Find out here!
